The calculator
On $98,000 of income, the 2026 tax is about $4,130: $4,130 federal. $34,050 of your Social Security is taxable. The next $1,000 you withdraw from an IRA would cost $222 in tax.
This year’s income sets your Medicare premiums for 2028. See your IRMAA tier.
How each kind of retirement income is taxed
| Income | Federal tax |
|---|---|
| Social Security | 0%, 50% or up to 85% of benefits is taxable, depending on your other income |
| Traditional IRA, 401(k), 403(b) withdrawals | Ordinary income, 10% to 37%; a 10% penalty before 59½ unless an exception applies |
| Pensions and annuity income | Ordinary income (the part that is not a return of after-tax money) |
| Roth IRA and Roth 401(k) withdrawals | Tax-free when qualified (age 59½ and the account open five years) |
| Roth conversions | Ordinary income in the year you convert |
| Qualified dividends and long-term gains | 0%, 15% or 20%; the 0% rate covers taxable income up to $49,450 single or $98,900 joint |
| Interest | Ordinary income (municipal bond interest is federally tax-exempt) |
| Wages | Ordinary income plus 7.65% FICA |
How much of my Social Security is taxable?
It depends on your combined income: half your benefits plus all your other income, including tax-exempt interest. Below the first threshold none of it is taxable. Between the two, up to 50% is. Above the second, up to 85% is. The thresholds are set in law and have never been raised for inflation, so more retirees cross them every year.
| Filing status | Up to 50% taxable above | Up to 85% taxable above |
|---|---|---|
| Single, head of household | $25,000 | $34,000 |
| Married filing jointly | $32,000 | $44,000 |
The tax on the next $1,000 you withdraw
Inside the Social Security phase-in, each extra dollar of IRA income can pull 50 or 85 cents of benefits into taxable income with it. A retiree in the 12% bracket can then pay 22% on the next dollar withdrawn, and someone in the 22% bracket about 41%. This is sometimes called the tax torpedo. The calculator’s “tax on the next $1,000” shows it for your numbers, and it is the figure to check before a Roth conversion or a large withdrawal. Which account to draw from first is the withdrawal order calculator.
2026 deductions for retirees
- Standard deduction: $16,100 single, $32,200 married filing jointly, $24,150 head of household.
- Extra deduction at 65 or older: $2,050 if unmarried, $1,650 for each married spouse.
- Senior deduction (tax years 2025 to 2028): $6,000 for each person 65 or older, reduced by 6% of modified AGI above $75,000 single or $150,000 joint, so it is gone at $175,000 and $250,000. Married couples must file jointly to claim it. It applies whether or not you itemize. The senior deduction calculator shows how much of it you keep.
2026 federal income tax brackets
| Rate | Single | Married filing jointly |
|---|---|---|
| 10% | $0 to $12,400 | $0 to $24,800 |
| 12% | $12,400 to $50,400 | $24,800 to $100,800 |
| 22% | $50,400 to $105,700 | $100,800 to $211,400 |
| 24% | $105,700 to $201,775 | $211,400 to $403,550 |
| 32% | $201,775 to $256,225 | $403,550 to $512,450 |
| 35% | $256,225 to $640,600 | $512,450 to $768,700 |
| 37% | Over $640,600 | Over $768,700 |
Long-term capital gains have their own brackets. The 0% capital gains calculator shows how much gain fits at the 0% rate this year, and the Roth conversion calculator shows how much you can convert before you reach the next bracket.
State taxes on retirement income
Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming have no tax on wages or retirement income (Washington taxes large capital gains). Eight states can tax Social Security in 2026: Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah and Vermont. Most of them exempt benefits below an income level or give a credit. The calculator applies Colorado’s and Utah’s rules; for the other six it does not yet apply the income-based exemptions, so it can overstate state tax on benefits at lower incomes. Many states also exclude part of pension or IRA income, and the calculator applies those exclusions for some states, not all. Check your state’s rules before relying on the state figure.
Assumptions and sources
One 2026 return under current law, with the standard deduction (no itemizing), no alternative minimum tax and no local income tax. Tax-exempt interest is not an input. The same tax engine runs inside Killion’s planner, which estimates this every simulated year when you turn tax on in a paid plan. Tax figures are estimates for planning, not tax advice.
Figures checked on against IRS Publication 915, Social Security and equivalent railroad retirement benefits, IRS Rev. Proc. 2025-32, 2026 inflation adjustments (PDF) and IRS, enhanced deduction for seniors (26 U.S.C. 151(d)(5)(C)).
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